Gambling: casinos and slot machines

Part 1 of 2

October 16, 2013

Gambling is a cultural universal. There are no historical periods or societies in which the wagering of money or other valuables on the outcome of some event or sport was absent.

In the American colonies, patriots anxious to rid themselves of English rule sold lottery tickets to finance the Revolutionary War. Lotteries were also instrumental in the founding of some of the nation's most prestigious universities: Harvard, Yale and Princeton. Gambling - legal and illegal - has always been popular in the United States, where people have never been shy about risking their money in the hopes of quick financial gain.

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Casino gambling

For most of our history, casino gambling was illegal. This changed in 1931, when Nevada legalized most games of chance and Las Vegas was transformed from a small desert oasis to a glitzy, nonstop-gambling vacation destination. In 1977, New Jersey legalized casino gambling in Atlantic City, revitalizing that run-down beach city and making it much easier for Eastern gamblers to lose their money closer to home.

Starting in the early 1990s, state governments saw the revenue potential of casino gambling, and casinos spread across the country at a rapid pace. By 1995, more than half of the nation's Native American reservations had some form of casino gambling. Currently there are well over 1,000 land-based, riverboat, dockside and racetrack casinos in 42 states, with most people in the Northeast and Mid-Atlantic states living no more than 70 miles from a casino.

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In a report from the Council of Casinos (an independent, nonpartisan group comprised of scholars and community leaders from across the country) entitled "Why Casinos Matter," the authors note that Las Vegas and Atlantic City (especially the former) are "destination resorts" that feature high-end restaurants, elegant shops and world-class entertainment where a significant percentage of gamblers come for minimally a weekend stay. The new wave of "regional casinos" attracts patrons who typically drive no more than 90 minutes (or take a bus), spend almost all of their time gambling and return home the same day. Whereas destination resort casinos are places people visit once or twice a year, regional casinos are frequented by gamblers several times a month and, for many, several times a week.

A number of studies have found that living close to a casino is a key factor in more frequent gambling excursions. As people increase the number of times they visit a casino, their risk of developing a serious gambling problem also increases. One study concluded that individuals who lived within 10 miles of a casino had a rate of problem gambling approximately twice as high as those who lived farther away.

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Slot machines

With the proliferation of casinos since 1990, the nature of casino gambling has changed dramatically. In Las Vegas and Atlantic City, gamblers wager significant sums of money on "table games" such as blackjack, roulette, craps and poker. Regional casinos are top-heavy with slot machines, with the number of these devices increasing from 184,000 in 1991 to 947,000 in 2010. Slots dominate regional casinos because they are highly profitable. According to one estimate, 62 to 80 percent of total casino revenue in 2013 will be slot machine driven. In some "racinos" (racetrack casinos), slot machines account for 90 percent of the take. Americans spend more money playing the slots than they do on movies, professional baseball games and at theme parks combined.

Non-gamblers likely think of slot machines in terms of the old-style, mechanical "one-armed bandit," with players sitting in front of these devices with bowls (if not buckets) of coins. Gamblers put a coin in the slot, pulled the handle to spin the wheel and hoped for three cherries, three 7s or some other winning combination to appear.

Today's slot machines are high-tech wonders that have little resemblance to their mechanical predecessors. They are designed and programmed for fast-paced, continuous action. Rather than money, modern slots are fed with plastic coins as gamblers make wagers from one penny to $100 on multiple lines that spin across a screen at the tap of a button.

The "Why Casinos Matter" report states, "Modern slots are hooked up to a central server that collects player information, preferences, and speed of play and has the capacity to program each machine to each player's style. In short, the laws of pure chance or probability no longer dictate wins and losses. The modern slot experience is deliberately engineered to take in much more than it pays out" by way of rewarding players just enough to keep them feeding the machine but not enough to turn a profit.

Bob Stupak, former CEO of the Stratosphere hotel and casino in Las Vegas, stated, "When we put 50 slot machines in, I always consider them 50 mousetraps. It's our duty to extract as much money as we can from our clients."

The proliferation of the modern slot machine as well as the explosion of legal state lotteries over the past 25 years have contributed to the "de-skilling" of gambling. While horse players and sports bettors must expend time and energy deciding what horse or team they will bet on, it takes no ability/skill whatsoever to buy a lottery ticket or push a slot machine button. Some observers are of the opinion de-skilled games are very effective in recruiting significant numbers of people to gambling.

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More casinos in New York state?

Gov. Cuomo, among a host of politicians, have made claims that new casinos in upstate New York will create jobs, generate money for education, and lower taxes. Anti-gambling groups state these claims are nothing more than unsubstantiated political "spin." David Blankenhorn of the conservative-leaning Institute for American Values argues, "There's not a single study that shows casinos contribute to economic growth. ... They don't create anything of value, and they divert energy, time and money from the productive to the non-productive sectors of society."

A Sept. 29 statement by the Catholic bishops of New York notes that although the Catholic Church is morally neutral on gambling in general, casinos, "with their free flowing alcoholic drinks, all-night hours and generally intoxicating atmosphere ... are more likely than other gambling options to lead to bad decisions and catastrophic losses for patrons, particularly those prone to problem or compulsive gambling."

While the economic impact of up to seven new casinos in New York state is debatable, more people gambling in more casinos will undoubtedly lead to an increase in the number of compulsive or pathological gamblers, a topic that will be discussed in the second part of this commentary.

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George J. Bryjak lives in Bloomingdale, retired after 24 years of teaching sociology at the University of San Diego.